In Raymours Furniture Co., Inc. v. Lexington Insurance Co. et al., No. 655167 2020, 2021 WL 4789148 (N.Y. Supr. Ct. N.Y. Cnty. Oct. 14, 2021), Mound Cotton’s clients were awarded a full dismissal with prejudice on the ground that the presence of the COVID-19 virus does not constitute “direct physical loss, damage, or destruction” to property. Judge Andrew Borrok explained that “business interruption insurance coverage exists only for damage caused by ‘direct physical loss, damage or destruction’” and, here, “there wasn’t any.” The insured “opened its stores as soon as governmental restrictions lifted and there was no change, at the time, in the effects of any Covid-19 particles.” The court also concluded that, even if there was physical damage, “the pollution and contamination exclusion would still apply.”
Partner Wayne Glaubinger and associate Jared Markowitz represented the following insurers in this case: Allied World National Assurance Co., Aspen Specialty Insurance Co., Ategrity Specialty Insurance Co., and Starr Surplus Lines Insurance Co.
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